NLRB Decisions Restore Employers’ Right to Use Work Rules to Control Workplace

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Jun 11, 2020

During the last half of May 2020, the National Labor Relations Board (Board) issued four decisions upholding the legality of employer facially neutral work rules. Two of the decisions applied the Boeing standard to assess the legality of work rules or policies while the other two decisions restored past precedent to find that an employers’ property rights outweighed employees’ right to engage in protected activities under §7 of the National Labor Relations Act (Act). The key highlights of those decisions, including guidance on drafting work rules and policies that are lawful under the Boeing standard, are summarized below.

Key Points

  • Confidentiality policies. Confidentiality policies that prohibit disclosure of co-worker contact information are classified as Boeing category 2 rules and must be individually assessed to ensure that such policies do not broadly ban employees from sharing co-worker contact information for §7 protected activity purposes in the context of a specific workplace.
  • Government investigation policies. If the terms of a work rule creates an ambiguity that may chill §7 protected activity, and the work rule proscribes employees’ ability to respond to government investigative inquiries, the work rule is classified as a Boeing category 2 rule because the context of the rule and the competing rights must be individually assessed.
  • On the other hand, government investigation work policies that unambiguously limit the work rule’s proscriptions to situations in which the employee is asked to provide information on behalf of the employer and does not preclude employees from participating in Board investigations may be presumptively lawful under §1(a) of the Boeing standard.
  • Ban on use of cell phones in work areas. Work rules that ban the possession of cell phones in work areas to minimize hazards, to comply with federal regulations, and to maintain integrity of its operations but permit cell phones to be stored in non-work areas are lawful under §1(b) of the Boeing standard.
  • When drafting facially neutral work rules and policies, the Boeing standard requires employers to consider the justification for the rule or policy but does not require employers to draft a narrow rule that anticipates “every conceivable §7 activity.”
  • Ban on union solicitations. Work rules banning union solicitations in work areas during work hours are presumptively lawful. Union solicitations are broadly defined, do not need to actually interfere with work and do not have to be accompanied by the presentation of a union authorization card to constitute a solicitation.
  • Ban on use of employer email systems for non-work purposes. Work rules banning non-work use of an employer’s email system are lawful so long as employees have alternative means of communicating with co-workers, and the employer does not discriminatorily enforce the rule by targeting union-related activities.

Government Investigation and Confidentiality policies are lawful

In Intrastate Management Company, LLC, two work policies, a government investigation and a confidentiality policy, were maintained by a third-party hotel management company (Company) and were challenged as adversely affecting employees’ §7 rights. The policies are set forth below in relevant part as follows:

Government Investigations policy: “We promote cooperation with law enforcement agencies and government agencies. However, rights of third parties, associates, customers, suppliers and others may be affected….Therefore, requests from the police, Internal Revenue Service and other regulatory authorities must not be answered without first obtaining clearance from the Legal Department.”

Information Protection policy:  “One of the most valuable assets is information and the information systems we use to process and store that data. Keeping confidential our Company’s non-public confidential information is important to the success of our Company… Confidential information includes, but is not limited to, personal information, which is defined broadly to include any information that can be associated with or traced to any individual, such as an individual’s name, address, telephone number, email address…. The personal information covered by the Code could pertain to… associate, former associate…”

The Company’s dual objective in adopting the government investigation rule was to provide guidance to employees concerning situations in which the Company was asked to cooperate in government investigations and to protect the rights of third parties who could be affected by the release of their information. Although the policy did not list the Company as a third party protected by the policy, it failed to expressly exclude the Company as a protected third party.

The ALJ determined that the government investigations policy’s impact on §7 rights was “severe” because the policy could be misinterpreted to require employees to obtain company approval before participating in a Board investigation. The Board disagreed. It found that the language of the policy reasonably could be read to refer only to third parties other than the Company but did not expressly exclude the Company. Therefore, the Board acknowledged the possibility that an employee could reasonably view the policy as limiting their right to cooperate with Board investigations in contravention of their §7 rights. However, the Company’s “compelling interest in safeguarding the information of its guests, associates and other third parties, and in protecting itself from liability outweighed the risk that employees would “misread the rule as restricting their ability to provide information to the authorities.” The Board characterized the policy as lawful under category 2 of the Boeing standard requiring such rules to be analyzed on a case-by-case basis.

Similarly, the Board characterized the confidentiality policy as lawful under category 2 of the Boeing standard. The ALJ found the confidentiality policy unlawful because it failed to provide an exception for contact information shared among employees as part of their work relationship. The Board, however, found that the language of the policy restricting disclosure was limited to company information stored in its databases, and not contact information that employees shared with each other or from a third-party during work. The employer’s legitimate interests in protecting the personal information of its employees and preventing data breaches outweighed any potential adverse impact to §7 interests. The Board further determined that confidentiality policies that prohibit disclosure of co-worker contact information must be individually assessed to ensure that such policies do not broadly ban employees from sharing co-worker contact information for §7 protected activity purposes in the context of a specific workplace.

Ban on possession of cell phones in work area is lawful

In Cott Beverages, Inc., the beverage manufacturer, Cott Beverages (Company), enforced work rules that prohibited employees from bringing personal cell phones to the manufacturing floor and in the warehouse but permitted the employees to store the cell phones in non-work areas. The Company justified its work rules as necessary to avoid contamination of beverage production processes and to minimize hazards inherent in food production as required by the FDA under the Food, Drug and Cosmetics Act. With regard to warehouse operations, the Company asserted that the safety risk associated with forklift accidents caused by distractions arising from cell phone use justified the prohibition on cell phones.

The ALJ determined that the rules prohibiting cell phones were unlawful because they infringed on §7 rights, such as the right to take photographs, record audio and video in the workplace, and to make §7 protected calls from the workplace. The ALJ rejected the Company’s justifications because the Company could have tailored its rules more narrowly to achieve its safety concerns without restricting protected activity.

While the Board acknowledged that the General Counsel met its burden of establishing that the rules adversely impact §7 rights, it reversed the ALJ decision upon determining that the potential infringement on §7 rights was slight because workers were able to access their phones in non-work areas. The Board held that a work rule barring cell phones in work areas was a lawful category 1(b) rule under the Boeing standard because the slight impact to employee protected activity rights was outweighed by the Company’s reasonable lawful efforts to ensure the integrity of the beverage production process, to comply with FDA rules, and to reduce the potential for accidents due to cell phone distractions in the warehouse. The Board further stated that the Company’s failure to craft a narrower rule to achieve its objectives was not a valid consideration and immaterial to the application of the Boeing standard.

Ban on union solicitations in work areas during work hours is lawful

In Wynn Las Vegas, LLC, a table games dealer for the hotel and casino, Wynn Las Vegas (Wynn), discussed an upcoming union representation election with a security officer during work hours. The conversation with the security officer interfered with the officer’s duties. As a result of the conversation, Wynn issued a written warning to the table games dealer for violation of its solicitation policy. Wynn’s solicitation policy limited union solicitations to non-working areas. The ALJ determined that the table games dealer engaged in a union solicitation and that the employer lawfully issued its warning under the solicitation policy. The General Counsel characterized the conversation as mere shop talk and contended that the ALJ erred in its characterization of the conversation as a union solicitation. The issue pits employees’ §7 right of self-organization against the right of the employer to maintain discipline in the workplace.

The Board began by overruling two decisions: the 2003 decision, Walmart Stores (340 NLRB 637), and the 2014 decision, ConAgra Foods. Both decisions narrowly construed the definition of union solicitation as requiring 1) the presentation of a union authorization card contemporaneously with a request to join a union and 2) a significant interruption of work. Both decisions also were criticized and rejected by the U.S. Court of Appeals, Eighth Circuit, which stated that discussions regarding union support “may be subject to a blanket prohibition during working time.” In Wynn, the Board rejected both requirements articulated in Walmart Stores and ConAgra Foods. It characterized the requirement of a contemporaneous presentation of a union authorization card as overly narrow and rejected the imposition of any durational requirement on conversations during work as part of the definition of a union solicitation.

The Board redefined a “union solicitation” to broadly refer to conduct promoting or urging rejection of the services of a union which includes not only encouraging others to join a union but also voting for or against union representation. According to the Board, a rule prohibiting solicitation during work hours is presumptively valid absent evidence that it was adopted for or applied in a discriminatory manner. Evidence established that Wynn applied the solicitation policy in a non-discriminatory manner.

Work rule banning non-work use of employer email is lawful

The allegations addressed in the May 27, 2020 NLRB decision, T-Mobile USA, Inc. (May 27th decision) were severed from the earlier April 2, 2020 T-Mobile USA, Inc., decision in which the Board found T-Mobile had committed unfair labor practices. The May 27th decision addressed the narrow issue of whether T-Mobile employees had alternative, reasonable means of communicating, other than the employer’s email system, to engage in §7 protected activity, and whether the Company’s promulgation of the work rule unlawfully infringed §7 organizational activities. An employee who worked at T-Mobile used her work email to encourage 595 co-workers to join a union. After learning of the employee’s emails to other employees, the employer distributed an email stating that the employee’s email violated several employer policies and announcing new work rules that prohibited employees from using social media during work hours and from sending mass communications to co-workers during work time that discussed the union. Evidence established that the employer had not previously permitted employees to send mass emails for personal or organizational purposes. No party disputed that the employees had other reasonable means of communicating with each other. 

In holding that the work rule was lawful, the Board invoked the standard announced in Caesar’s Entertainment Corporation (Caesar’s) that permits an employer to prohibit non-business related use of its information technology resources, such as email, including use related to §7 protected activities, absent 1) “proof that employees would not otherwise be deprived of any reasonable means of communicating” with their co-workers and 2) proof of discrimination against union-related communications or activities. The Caesar’s decision was issued at the end of 2019, overruling the 2014 decision, Purple Communications, Inc., and reestablishing decades of past precedent. Caesar’s balances the competing rights of companies to control their property and of employees to exercise §7 rights.

The Board also held that promulgation of work rules consistent with policies prohibiting non-work use of its email system did not violate the Act because the work rules were in response to the employer’s “lawful restrictions” and not the employee’s protected activity.